Budget thoughts

For what were all these country patriots born?
To hunt, and vote, and raise the price of corn?

I remember Budget days when I was growing up, adults glued to the radio announcement – no live TV coverage in the 70s – to find what was going up – usually everything – and by how much. The area round the petrol station at the end of our road was always jammed with motorists trying to squeeze that last few centilitres of fuel in before the cost went up. For some reason, I remember that there was usually a deadline – at 6pm, the prices would rise, hence the queues to get in there first. Mind you, some things don’t change. I remember when we had that mini-fuel crisis in September 2021, wondering why the main road through town was rammed solid at midnight, only to discover it was because the news had got out that the BP garage had had a delivery.

I digress. Back then, the Budget announcements were a surprise. These days, the number of leaks running up to the Chancellor’s speech, whether deliberate or not, mean we pretty much know what to expect.

A 2pence in the pound cut in employees’ National Insurance rate seems to be the headline that we are all expecting. How much good will it do? Some, I suppose, if it means that consumer confidence increases if people feel a little richer. Though the ‘fiscal drag’ caused by the long-frozen tax allowance threshold bumping people up into higher tax brackets means that many will fail to reap the full benefits of any NI cut. At best, for a lot of people, tax cuts just mean there is a little less month left at the end of the money.

Costs have gone up so much – energy , fuel, food, transport – that tinkering with tax rates isn’t going to get the economy booming by encouraging the public to spend, spend, spend. If you’re pulling in £100,000 a year, is the projected saving of £754 a year going to make a huge difference to your household wealth? It’s £62 a month, enough to buy you a basket of groceries at Aldi, maybe Tesco, if you have a Clubcard. It won’t go far in Sainsburys, and it might get you a tank of petrol. But only if you don’t buy the groceries.

The average UK salary is £28,000. A saving of £30 or so a month is really not going to make a hill of beans’ difference to your long-term financial stability. Or even your short-term.

We need to see all the things that have been asked before: a nationwide retrofit strategy, a programme to boost housebuilding, investment in infrastructure, our school buildings, and  rethink of how social care is funded – councils are clearly struggling to manage this. I’m not expecting anything more than a bit of tinkering, a holding pattern to get them through to the Autumn Statement and to the General Election. When, in all probability, most of Hunt’s cunning plans will be junked by the incoming administration. Or watered down by the shackles of a hung Parliament.

We’ll have to see what he comes out with at lunchtime.